Buying at a French auction

Buying at auction in France is an alternative to the traditional method of purchasing a property. Susan Comaish finds out what’s involved...

Maybe you’ve watched hundreds of episodes of Homes under the Hammer or perhaps you've bought a property at auction in Britain and are keen to repeat the process in France. Certainly in the UK it appears possible, particularly at the moment, to get a real bargain at the auction rooms but is that true in France and how easy is it to buy a property in the sale room?If you are interested in buying at auction here it will be much easier if you already live in France, as you’ll be able to find out what is going on in the auction market and you’ll be able to visit the property more easily, as appointments are on set days and not individually set according to your timetable. Also you will be able to visit a few auctions before actually bidding at one.If you are unused to bidding at auction for furniture let alone a property, a good piece of advice is to accustom yourself to how it all works and, if you are unsure of your French language skills, make sure you are accompanied by someone who is fluent.Before the day, inform yourself both about the property you are interested in and the method by which it will be sold. It may seem archaic but most property auctions take place using a procedure known as vente � la bougie – a candle auction. To begin the auction the notaire lights a candle, the bidding continues and when one candle dies a second is lit – when this second candle goes out, and, if there are no further bids, the auction is finished. In some auctions it seems three and not two candles are used. Nowadays some notaires use electric lights instead of candles.After the final bid, there is still a period of waiting. A further bid (which has to be more than 10% higher than the highest bid on the day) may be made during the 10 days following the auction. If this is the case, the property is put back into auction beginning at the highest price. According to the notaires’ website, this rarely happens but it is important to know it could.If you have made a successful bid, you have 45 days to pay the complete price for the property. There is, unlike with a normal sale, no sevenday cooling-off period. This is vital to remember – it’s easy to fall in love with a property and then get cold feet when faced with the stark reality of the costs of both buying and any potential work. If you are unable to pay, you are liable for the difference between the price achieved in the new sale and that in the first auction.Do your homeworkAbove all, when buying in this fashion homework is vital. As in Britain, particulars about each property are available, in this case from the notaire – they are called the cahier des charges and are very detailed. Read them carefully to make sure there are no conditions attached to the sale which are unacceptable to you. It will often state that the property is sold as seen and therefore there are no guarantees – i.e. buyer beware.Do your legwork before the auction and there will be less chance of making mistakes. Decide on your total budget, put plans in place to make the money available within the time constraints. Remember, a percentage must be available on the day of the auction and this takes the form of a banker’s cheque (drawn on a French bank account). The amount depends on the notaire and the value of the property.When you have found a property you like, visit it – sounds obvious but many people don’t. This way you know as much as possible about the area the building or plot is in, you know the state of the fabric of the building(s) if there are any and it will give you an idea of how much you need to spend on it to transform it into your home or business.On the day of the visit, the notaire dealing with the auction will have a representative on site and they can be asked additional questions. Don’t forget you won’t be the only one visiting on that day so allow plenty of time for queues. If there are lots of other potential buyers, don’t get suckered into thinking this means it is a great property – it may just mean they are carpet treaders! Keep your head firmly out of the clouds and make a lot of lists on this all-important visit. Also, bear in mind that some properties have a rather low estimate price put on them to draw in bidders.Some notaires will allow further visits but this is rare, particularly if they are handling a lot of properties at once. List all that needs to be done, all the questions you need to ask, all the points you like about the property and those you don’t. Go away and do the sums. If you are going to do the work yourself allow enough for materials and time; if you are getting artisans involved, try and find out about going rates in your area. Not easy when you probably won’t have time to have quotes prepared but do as much as possible. Then work out what the property is worth to you and stick to your decision! Make your bid nowOn the day, allow plenty of time to register with the notaire. You will be asked to provide identity papers (a passport for example) and a cheque made out to the notaire selling the property for typically 20% of the amount the property is listed for. This needs to be a banker’s cheque drawn on a French bank. You will then receive a number and may then make a bid by announcing your number and the amount you wish to bid. There is no need for a lawyer or notaire to bid for you.Check with the notaire before to make sure they do not require any extra information – it may vary from office to office, particularly if they haven’t dealt with non-French bidders before. If you make a successful bid you have 45 days to pay the balance for the property, although if it is a judicial auction, this can sometimes be longer.Why go to auction?In France, the majority of homes are sold by estate agents and notaires. Properties sold by auction make up a very small percentage of the market, which would suggest it is not necessarily a good place to buy but you may pick up a bargain – it does happen.You will save on estate agents’ fees – fees for buying through auctions are often considerably less than those through agencies. More importantly, you may find unusual properties this way. Many communes have bought buildings in the hope of restoring them and using them for the benefit of the commune but have found it impossible to do so because of money restraints, and these buildings are now coming on to the market and can be quite special.In the Deux-S�vres area, property developers commented that buildings recently auctioned by the commune were over-priced, but this should not necessarily put you off – you may not be looking for a money-maker but the right property’. In the recent Niort auctions, one of the oldest properties on the oldest street in the town has been bought by a young couple who are going to turn it into a recording studio and exhibition space. Which means that a listed property which has been empty for many years is now being given a new lease of life. Perhaps you could find a similar gem.For further information in English and French, carry out internet searches and you will find many sites dealing with this subject. If you are unsure of any of the legal or financial implications of buying at auction in France, it is essential to take professional advice from either a notaire or similarly qualified person to avoid errors. This is not for the lighthearted, we’ve had a glass of wine, let’s sign a compromis de vente, we can always change our mind in seven days’ – if you buy at auction, you can’t change your mind, there is no seven-day cooling-off period, when the candle goes out on your bid, it’s yours.